EXHIBIT 10.12
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF NOR ANY
INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED, ENCUMBERED OR IN ANY OTHER MANNER TRANSFERRED OR DISPOSED OF
EXCEPT IN COMPLIANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, STATE
SECURITIES STATUTES AND THE TERMS AND CONDITIONS HEREOF. THE HOLDER OF THIS
WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF ARE SUBJECT TO THE
RESTRICTIONS HEREIN SET FORTH.
========================
Warrant No. 1
WARRANT
TO
PURCHASE 100,000 SHARES COMMON STOCK
OF
HEALTHTECH DELIVERY, INC.
========================
This Warrant dated as of April 18, 1997 ("Warrant") certifies that, for
good and valuable consideration, HEALTHTECH DELIVERY, INC., a Delaware
corporation (the "Company"), grants to EQUUS II INCORPORATED, a Delaware
corporation ("Equus"), or permitted registered assigns (the "Warrantholder" or
"Warrantholders"), subject to the terms and conditions set forth herein, the
right to subscribe for and purchase from the Company: One Hundred Thousand
(100,000) shares (the "Warrant Shares") of the Company's common stock, par value
$.001 per share ("Common Stock"), at the initial per share public offering price
(the "Exercise Price") of Common Stock offered to the public in the Company's
initial public offering ("IPO"), during the period from and after 9:00 a.m.
Houston, Texas time on the date of the closing of the IPO (the "Initial Exercise
Date") and to and including 5:00 p.m. Houston, Texas time on the fifth
anniversary of the Initial Exercise Date (the "Expiration Date"). The Exercise
Price and the number of Warrant Shares are subject to adjustment from time to
time as provided in Section 5.
1. DURATION AND EXERCISE OF WARRANT; LIMITATION EXERCISE PAYMENT OF
TAXES.
1.1 DURATION AND EXERCISE OF WARRANT. The rights represented by
this Warrant may be exercised by the Warrantholder of record, in whole, or from
time to time in part (but covering at least the lesser of 1,000 shares or the
remaining unexercised portion of this Warrant), by surrender of this Warrant,
accompanied by the Exercise Form annexed hereto (the "Exercise Form") duly
executed by the Warrantholder of record and specifying the number of Warrant
Shares to be purchased, to the Company at the office of the Company located at
0000 Xxxxxxxxxx Xxxxxx Xxxx Xxxx, Xxxx 00000 (or such other office or agency of
the Company as it may designate by notice to the Warrantholder at the address of
such Warrantholder appearing on the books of the Company) during normal business
hours on any day (a "Business Day") other than a Saturday, Sunday or a day on
which the Company is otherwise closed for business (a "Nonbusiness Day") on or
after 9:00 a.m. Houston, Texas time on the Initial Exercise Date but not later
than 5:00 p.m. on the Expiration Date (or 5:00 p.m. on the next succeeding
Business Day, if the Expiration Date is a Nonbusiness Day), delivery of payment
to the Company in cash or by certified bank check of the Exercise Price for the
number of Warrant Shares specified in the Exercise Form and such documentation
as to the identity and authority of the Warrantholder as the Company may
reasonably request. Such Warrant Shares shall be deemed by the Company to be
issued to the Warrantholder which is the record holder of such Warrant Shares as
of the close of business on the date on which this Warrant shall have been
surrendered and payment made for the Warrant Shares as aforesaid. Certificates
for the Warrant Shares specified in the Exercise Form shall be delivered to the
Warrantholder as promptly as practicable, and in any event within 10 business
days, thereafter. The stock certificates so delivered shall be in denominations
of at least 1,000 shares each or such other denomination as may be specified by
the Warrantholder and agreed upon by the Company, and shall be issued in the
name of the Warrantholder or, if permitted by subsection 1.5 and in accordance
with the provisions thereof, such other name as shall be designated in the
Exercise Form. If this Warrant shall have been exercised only in part, the
Company shall, at the time of delivery of the certificates for the Warrant
Shares, deliver to the Warrantholder a new Warrant evidencing the rights to
purchase the remaining Warrant Shares, which new Warrant shall in all other
respects be identical with this Warrant. No adjustments or payments shall be
made on or in respect of Warrant Shares issuable on the exercise of this Warrant
for any cash dividends paid or payable to holders of record of Common Stock
prior to the date as of which the Warrantholder shall be deemed to be the record
holder of such Warrant Shares.
1.2 LIMITATION ON EXERCISE. If this Warrant is not exercised
prior to 5:00 p.m. on the Expiration Date (or the next succeeding Business Day,
if the Expiration Date is a Nonbusiness Day), this Warrant, or any new Warrant
issued pursuant to Section 1.1, shall cease to be exercisable and shall become
void and all rights of the Warrantholder hereunder shall cease. This Warrant
shall not be exercisable and no Warrant Shares shall be issued hereunder, prior
to 9:00 a.m. Houston, Texas time on the Initial Exercise Date.
1.3 CASHLESS EXERCISE. Notwithstanding Section 1.1 above, the
Warrantholder, in lieu of the payment of cash or certified bank check for the
aggregate Exercise Price for shares of Common Stock as to which this Warrant is
being exercised, may elect by written notice delivered
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to the Company at the time the Exercise Form is delivered to the Company
pursuant to Section 1.1 above, to effect a "cashless exercise," in which case
(i) the Warrantholder need not pay the aggregate Exercise Price to the Company
in cash or by certified bank check, and (ii) the number of shares of Common
Stock issuable upon such exercise shall be reduced by a number of shares of
Common Stock determined by dividing (x) the aggregate Exercise Price for all
shares of Common Stock as to which this Warrant is then being exercised by (y)
the Current Market Price (as such term is hereinafter defined) per share of
Common Stock at the date of such exercise, and by then rounding downward to the
nearest whole share of Common Stock.
1.4 PAYMENT OF TAXES. The issuance of certificates for Warrant
Shares shall be made without charge to the Warrantholder for any stock transfer
or other issuance tax in respect thereto; PROVIDED, HOWEVER, that the
Warrantholder shall be required to pay any and all taxes which may be payable in
respect to any transfer involved in the issuance and delivery of any
certificates for Warrant Shares in a name other than that of the then
Warrantholder as reflected upon the books of the Company.
1.5 TRANSFER; RESTRICTION ON TRANSFER AND LEGEND.
(a) Subject to the provisions of Section 1.5(b) below, this
Warrant may be transferred, in whole or in part, at any time, without
the consent of the Company, by notice from Warrantholder. The Company
shall keep at its principal office a register in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide
for the registration, transfer and exchange of this Warrant. The Company
will not at any time, except upon the dissolution, liquidation or
winding up of the Company, close such register so as to prevent or delay
the exercise or transfer of this Warrant.
(b) Neither this Warrant nor any of the Warrant Shares, nor any
interest or participation in either, may be in any manner transferred or
disposed of, in whole or in part, except in compliance with applicable
United States federal and state securities laws.
Each certificate for Warrant Shares and any Warrant issued at any
time in exchange or substitution for any Warrant bearing such a legend
shall bear a legend similar in effect to the foregoing paragraph 1.5(b)
unless, in the opinion of counsel for the Company, the Warrant need no
longer be subject to the restriction contained herein. The provisions of
this subsection 1.5 shall be binding upon all subsequent holders of this
Warrant, if any. Warrant Shares transferred to the public as expressly
permitted by, and in accordance with, the provisions of this Warrant
shall thereafter cease to be deemed to be "Warrant Shares" for purposes
hereof.
1.6 DIVISIBILITY OF WARRANT. This Warrant may be divided into
warrants representing one Warrant Share or multiples thereof, upon surrender at
the principal office of the Company on any Business Day, without charge to any
Warrantholder, except as provided below. The Warrantholder will be charged for
reasonable out-of-pocket costs incurred by the Company in connection with the
division of this Warrant into Warrants representing fewer than one thousand
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(1,000) Warrant Shares. Upon any such division, and, if permitted by subsection
1.5 and in accordance with the provisions thereof, the Warrants may be
transferred of record to a name other than that of the Warrantholder of record;
PROVIDED, HOWEVER, that the Warrantholder shall be required to pay any and all
transfer taxes with respect thereto.
2. RESERVATION AND LISTING OF SHARES. All Warrant Shares which are
issued upon the exercise of the rights represented by this Warrant shall, upon
issuance and payment of the Exercise Price, be validly issued, fully paid and
nonassessable and free from all taxes, liens, security interests, charges and
other encumbrances with respect to the issue thereof other than taxes in respect
of any transfer occurring contemporaneously with such issue. During the period
within which this Warrant may be exercised, the Company shall at all times have
authorized and reserved, and keep available free from preemptive rights, a
sufficient number of shares of Common Stock to provide for the exercise of this
Warrant, and shall at its expense use all commercially reasonable efforts to
procure such listing thereof (subject to official notice of issuance) as then
may be required on all stock exchanges on which the Common Stock is then listed.
The Company shall, from time to time, take all such action as may be required to
assure that the par value per share of the Warrant Shares is at all times equal
to or less than the then effective Exercise Price.
3. EXCHANGE, LOSS OR DESTRUCTION OF WARRANT. If permitted by subsection
1.5 or 1.6 and in accordance with the provisions thereof, upon surrender of this
Warrant to the Company with a duly executed instrument of assignment and funds
sufficient to pay any transfer tax, the Company shall, without charge, execute
and deliver a new Warrant of like tenor in the name of the assignee named in
such instrument of assignment and this Warrant shall promptly be cancelled. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and, in the case of loss, theft or
destruction, of such bond or indemnification as the Company may reasonably
require, and, in the case of such mutilation, upon surrender and cancellation of
this Warrant, the Company will execute and deliver a new Warrant of like tenor.
The term "Warrant" as used herein includes any Warrants issued in substitution
or exchange of this Warrant.
4. OWNERSHIP OF WARRANT. The Company may deem and treat the person in
whose name this Warrant is registered as the holder and owner hereof
(notwithstanding any notations of ownership or writing hereon made by anyone
other than the Company) for all purposes and shall not be affected by any notice
to the contrary, until presentation of this Warrant for registration of transfer
as provided in subsections 1.1, 1.5 and 1.6 or in Section 3.
5. CERTAIN ADJUSTMENTS. The Exercise Price at which Warrant Shares may
be purchased hereunder, and the number of Warrant Shares to be purchased upon
exercise hereof, are subject to change or adjustment as follows:
5.1 ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. If the Company
issues or sells any shares of Common Stock (other than up to 100,000 shares of
Common Stock to be issued by the Company in a private placement at $5 per share
within 60 days after the date hereof) for a consideration per share less than
(x) the Exercise Price or (y) the then Current Market Price (as
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hereinafter defined) per share of Common Stock in effect immediately prior to
the time of such issue or sale, the Exercise Price shall be reduced to the lower
of the prices calculated by:
(1) dividing (A) an amount equal to the sum of (x) the number
of shares of Common Stock outstanding immediately prior to
such issue or sale multiplied by the then existing
Exercise Price plus (y) the aggregate consideration, if
any, received by the Company upon such issue or sale, by
(B) the total number of shares of Common Stock outstanding
immediately after such issue or sale; and
(2) multiplying the then existing Exercise Price by a fraction
the numerator of which is (A) the sum of (x) the number of
shares of Common Stock outstanding immediately prior to
such issue or sale multiplied by the Current Market Price
per share of Common Stock immediately prior to such issue
or sale plus (y) the consideration received by the Company
upon such issue or sale divided by (B) the total number of
shares of Common Stock outstanding immediately after such
issue or sale, and the denominator of which shall be the
Current Market Price per share of Common Stock immediately
prior to such issue or sale.
For purposes of this Section 5.1, the date as of which the
Current Market Price per share of Common Stock shall be computed shall be the
earlier of the date upon which the Company shall (i) enter into a firm contract
for the issuance of such shares or (ii) issue such shares.
5.2 PROVISIONS APPLICABLE TO SECTION 5.1. For purposes of Section
5.1, the following subsections (a) through (l), inclusive, shall be applicable:
(a) ADJUSTMENT OF NUMBER OF SHARES PURCHASABLE. Upon any
adjustment of the Exercise Price as provided in Section 5.1 or in this
Section 5.2, the Warrantholder shall thereafter be entitled to purchase,
at the Exercise Price resulting from the adjustment, the number of
shares of Common Stock (calculated to the nearest 1/100th of a share)
obtained by multiplying the Exercise Price in effect immediately before
the adjustment by the number of shares of Common Stock purchasable
hereunder immediately before the adjustment and dividing the product
thereof by the Exercise Price resulting from the adjustment.
(b) ISSUANCE OF WARRANTS OR OTHER RIGHTS. If the Company in any
manner grants (whether directly or by assumption in a merger or
otherwise) any rights to subscribe for or to purchase, or any options
for the purchase of, Common Stock or Convertible Securities (as
hereinafter defined), whether or not such rights or options or the right
to convert or exchange any such Convertible Securities are immediately
exercisable, and if the price per share for which shares of Common Stock
are issuable upon the exercise of such rights or options or upon
conversion or exchange of such Convertible Securities is less than (i)
the Exercise Price in effect immediately before the granting of such
rights or options or (ii) the Current Market Price per share of Common
Stock existing immediately before the granting of such rights or
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options, then the maximum number of shares of Common Stock issuable upon
the exercise of such rights or options or upon conversion or exchange of
the maximum amount of such Convertible Securities issuable upon the
exercise of such rights or options shall (as of the date for the
determination of the Current Market Price per share of Common Stock as
hereinafter provided) be deemed to be outstanding and to have been
issued for such price per share. The price per share for which shares of
Common Stock are issuable upon the exercise of such right or options or
upon conversion or exchange of such Convertible Securities shall be
determined by dividing (1) the total amount, if any, received or
receivable by the Company as consideration for the granting of such
rights or options, plus the minimum aggregate amount of additional
consideration payable to the Company upon the exercise of such rights or
options, plus, in the case of such Convertible Securities, the minimum
aggregate amount of additional consideration, if any, payable upon the
conversion or exchange thereof, by (2) the total maximum number of
shares of Common Stock issuable upon the exercise of such rights or
options or upon the conversion or exchange of all such Convertible
Securities issuable upon the exercise of such rights or options. No
further adjustments of the Exercise Price shall be made upon the actual
issue of such Common Stock or of such rights or options or upon the
actual issue of such Common Stock upon conversion or exchange of such
Convertible Securities except as otherwise provided in subsection (d)
below. For purposes of this subsection (b), the date as of which the
Current Market Price per share of Common Stock shall be computed shalt
be the earlier of the date upon which the Company shall (i) enter into a
firm contract for the issuance of such rights or other options or (ii)
issue such rights or other options.
(c) ISSUANCE OF CONVERTIBLE SECURITIES. If the Company in any
manner issues or sells (whether directly or by assumption in a merger or
otherwise) any Convertible Securities, whether or not the rights to
exchange or convert thereunder are immediately exercisable, and the
price per share for which shares of Common Stock are issuable upon such
conversion or exchange shall be less than (i) the Exercise Price in
effect immediately prior to the time of such issue or sale or (ii) the
Current Market Price per share of Common Stock existing immediately
prior to the time of such issue or sale, then the maximum number of
shares of Common Stock issuable upon conversion or exchange of all such
Convertible Securities shall (as of the date for the determination of
the Current Market Price per share of Common Stock as hereinafter
provided) be deemed to be outstanding and to have been issued for such
price per share; provided however, except as otherwise specified in
subsection (c) below, (1) no further adjustments of the Exercise Price
shall be made upon the actual issue of such Common Stock upon conversion
or exchange of such Convertible Securities and (2) if any such issue or
sale of such Convertible Securities is made upon exercise of any rights
to subscribe for or to purchase or any option to purchase any such
Convertible Securities for which adjustments of the Exercise Price have
been or are to be made under other provisions of Sections 5.1 and 5.2,
no further adjustment of the Exercise Price shall be made by reason of
such issue or sale. The price per share for which shares of Common Stock
are issuable upon such conversion or exchange shall be determined by
dividing (x) the total amount received or receivable by the Company as
consideration for the issue or sale of such Convertible Securities, plus
the minimum aggregate amount of additional consideration, if
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any, payable to the Company upon the conversion or exchange thereof, by
(y) the total maximum number of shares of Common Stock issuable upon the
conversion or exchange of all such Convertible Securities. For purposes
of this subsection (c), the date as of which the Current Market Price
per share of Common Stock shall be computed shall be the earlier of the
date upon which (i) the Company shall enter into a firm contract for the
issuance of such Convertible Securities or (ii) such Convertible
Securities are actually issued.
(d) READJUSTMENT OF EXERCISE PRICE. If (i) the purchase price
provided for in any rights or options referred to in subsection (b)
above, or (ii) the additional consideration, if any, payable upon the
conversion or exchange of Convertible Securities referred to in
paragraph (b) or (c) above, or (iii) the rate at which any Convertible
Securities referred to in subsection (b) or (c) above are convertible
into or exchangeable for Common Stock shall change (other than under or
by reason of provisions designed to protect against dilution), the
Exercise Price in effect at the time of such event shall forthwith be
readjusted to the Exercise Price which would have been in effect at such
time had such rights, options or Convertible Securities still
outstanding provided for such changed purchase price, additional
consideration or conversion rate, as the case may be, at the time
initially granted, issued or sold. On the expiration of any such option
or right or the termination of any such right to convert or exchange
such Convertible Securities, the Exercise Price then in effect shall be
increased to the Exercise Price which would have been in effect at the
time of such expiration or termination had such right, option or
Convertible Security never been issued, and the Common Stock issuable
thereunder shall no longer be deemed to be outstanding. If the purchase
price provided for in any such rights or options referred to in
paragraph (b) above or the rate at which any Convertible Securities
referred to in paragraph (b) or (c) are convertible into or exchangeable
for Common Stock, shall be reduced at any time under or by reason of
provisions with respect thereto designed to protect against dilution,
then in case of the delivery of Common Stock upon the exercise in any
such rights or options or upon conversion or exchange of any such
Convertible Securities, the Exercise Price then in effect hereunder
shall forthwith be adjusted to such amount as would have obtained had
such right, option or Convertible Securities never been issued as to
such Common Stock and had adjustments never been made upon the issuance
of the shares of Common Stock delivered as aforesaid, but only if as a
result of such adjustment the Exercise Price then in effect hereunder is
thereby reduced.
(e) MINIMUM ADJUSTMENT. If any adjustment of the Exercise Price
pursuant to Section 5.1 results in an adjustment of less than $.001 per
share of Common Stock, no such adjustment shall be made, but any such
lesser adjustment shall be carried forward and shall be made at the time
and together with the next subsequent adjustment which, together with
any adjustments so carried forward, shall amount to $.001 or more per
share of Common Stock; provided, however, upon any adjustment of the
Exercise Price resulting from (i) the declaration of a dividend upon, or
the mailing of any distribution in respect of, any stock of the Company
payable in Common Stock or Convertible Securities or (ii) the
reclassification, by subdivision, combination or otherwise, of the
Common Stock into a greater or smaller number of shares, the foregoing
figure of $.001 per share (or such figure as last adjusted)
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shall be proportionately adjusted; provided, further, upon the exercise
of this Warrant, the Company shall make all necessary adjustments not
theretofore made to the Exercise Price up to and including the date upon
which this Warrant is exercised.
(f) CONSIDERATION FOR DIVIDENDS IN SECURITIES. If the Company
declares a dividend or makes any other distribution upon any stock of
the Company payable in either case in Common Stock or Convertible
Securities, such Common Stock or Convertible Securities, as the case may
be, issuable in payment of such dividend or distribution shall be deemed
to have been issued or sold without consideration.
(g) CONSIDERATION FOR RIGHTS OR OPTIONS. If any rights or options
to purchase any shares of Common Stock or Convertible Securities are
issued in connection with the issue or sale of other securities of the
Company, together comprising one integral transaction in which no
specific consideration is allocated to the rights or options, the rights
or options shall be deemed to have been issued without consideration.
(h) DETERMINATION OF CONSIDERATION UPON PAYMENT OF CASH, PROPERTY
OR MERGER. If any shares of Common Stock or Convertible Securities or
any rights or options to purchase any such Common Stock or Convertible
Securities are issued or sold for cash, the consideration received
therefor shall be deemed to be the net amount received by the Company
therefor, after deduction of any accrued interest, dividends or any
expenses incurred or any underwriting commissions or concessions paid or
allowed by the Company in connection therewith. If any shares of Common
Stock or Convertible Securities or any rights or options to purchase any
such Common Stock or Convertible Securities are issued for a
consideration other than cash, the amount of the consideration other
than cash received by the Company shall be deemed to be the fair market
value on the date of issue of the securities so issued by the Company,
as determined in good faith by the Board of Directors of the Company,
less any expenses incurred by the Company in connection therewith. If
any shares of Common Stock or Convertible Securities or any rights or
options to purchase such Common Stock or Convertible Securities are
issued in connection with any merger or consolidation in which the
Company is the surviving corporation, the amount of consideration
therefor shall be deemed to be the fair market value thereof on the date
of issue, as determined in good faith by the Board of Directors of the
Company, for such portion of the assets and business of the
non-surviving corporation as the Board of Directors shall attribute to
such Common Stock, Convertible Securities, rights or options, as the
case may be. In the event of any consolidation or merger of the Company
in which the Company is not the surviving corporation or in the event of
any sale of all or substantially all of the assets of the Company for
stock or other securities of any corporation, the Company shall be
deemed to have issued a number of shares of its Common Stock for stock
or securities of the other corporation computed on the basis of the
actual exchange ratio on which the transaction was predicated and for a
consideration equal to the fair market value on the date of such
transaction of such stock or securities of the other corporation, and if
any such calculation results in adjustment of the Exercise Price, the
determination of the number of shares of Common Stock issuable upon
exercise of this Warrant immediately prior to such merger,
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consolidation or sale, for the purposes of subsection (n) below, shall
be made after giving effect to such adjustment of the Exercise Price.
(i) RECORD DATE. If the Company takes a record of the holders of
the Common Stock for the purpose of entitling them (i) to receive a
dividend or other distribution payable in Common Stock or in Convertible
Securities or (ii) to subscribe for or purchase Common Stock or
Convertible Securities, then the record date shall be deemed to be the
date of the issue or sale of the shares of Common Stock deemed to have
been issued or sold upon the declaration of the dividend or the making
of such other distribution or the date of the granting of the right of
subscription or purchase, as the case may be.
(j) SHARES OUTSTANDING. The number of shares of Common Stock
deemed to be outstanding at any given time shall (i) include shares of
Common Stock issuable in respect of scrip certificates which have been
issued in lieu of fractional shares of Common Stock, but (ii) exclude
(1) shares of Common Stock in the treasury of the Company or any
Subsidiary, (2) shares of Common Stock previously issued upon the
exercise of the Warrants and (3) shares of Common Stock issuable upon
the exercise of the Warrants.
(k) SPLITS AND COMBINATIONS. If the Company at any time
subdivides its outstanding shares of Common Stock into a greater number
of shares, the Exercise Price in effect immediately before the
subdivision shall be proportionately reduced, and, conversely, if the
outstanding shares of Common Stock of the Company are combined into a
smaller number of shares, the Exercise Price in effect immediately
before the combination shall be proportionately increased.
(l) REORGANIZATION, RECLASSIFICATION OR RECAPITALIZATION OF
COMPANY. In case of any capital reorganization or reclassification or
recapitalization of the capital stock of the Company (other than (i) in
the cases referred to in subsection (k) of this Section 5.2 and (ii) a
change in par value, or from par value to no par value or from no par
value to par value) or in case of the consolidation or merger of the
Company with or into another corporation or in case of the sale or
transfer of the property of the Company as an entirety or substantially
as an entirety, there shall thereafter be deliverable upon the exercise
of this Warrant or any portion thereof (in lieu of or in addition to the
number of shares of Common Stock theretofore deliverable) the number of
shares of stock or other securities or property to which the holder of
the number of shares of Common Stock which would otherwise have been
deliverable upon the exercise of this Warrant or any portion thereof at
the time would have been entitled upon such capital reorganization or
reclassification of capital stock, consolidation, merger or sale, and at
the same aggregate Exercise Price. Prior to and as a condition of the
consummation of any transaction described in the preceding sentence, the
Company shall make appropriate, written adjustments in the application
of the provisions herein set forth satisfactory to the holders of
Warrants entitled to purchase not less than a majority of the shares of
Common Stock issuable upon the exercise thereof with respect to the
rights and interests of the holders of Warrants so that the provisions
set forth herein shall thereafter be applicable, as nearly as possible,
in relation to any shares of stock or other
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securities or other property thereafter deliverable upon exercise of
this Warrant. Any such adjustment shall be made by and set forth in a
supplemental agreement between the Company and the successor entity and
be approved by the holders of Warrants entitled to purchase not less
than a majority of the shares of Common Stock issuable upon the exercise
thereof.
(m) NO ADJUSTMENT FOR A CERTAIN SPLIT OF COMMON STOCK. No
adjustment shall be made pursuant to this Section 5.2 as a result of a
subdivision of each share of Common Stock outstanding on September 5,
1997 into 1.3379145 shares of Common Stock.
5.3 RIGHTS OFFERING. If the Company effects an offering of Common
Stock pro rata among its stockholders, the Warrantholder shall be entitled, at
its option, to elect to participate in each and every such offering as though
this Warrant had been exercised and the Warrantholder were, at the time of any
such rights offering, then a holder of that number of shares of Common Stock to
which the Warrantholder is then entitled on the exercise hereof.
5.4 CERTIFICATES.
(a) Upon any adjustment of the Exercise Price pursuant to Section
5.1 or Section 5.2 above, a certificate signed (i) by the President or a
Vice President and by the Treasurer or an Assistant Treasurer or the
Secretary or an Assistant Secretary of the Company or (ii) by any
independent firm of certified public accountants of recognized national
standing selected by, and at the expense of, the Company setting forth
in reasonable detail the events requiring the adjustment and the method
by which such adjustment was calculated, shall be mailed (by first class
mail, postage prepaid) to the Warrantholder specifying the adjusted
Exercise Price and the number of shares of Common Stock purchasable upon
exercise of this Warrant after giving effect to the adjustment of such
number pursuant to Section 5.1 or Section 5.2. The certificate of any
independent firm of certified public accountants of recognized national
standing selected by the Board of Directors of the Company shall be
conclusive evidence of the correctness of any computation made under
Section 5.1 or Section 5.2.
(b) In case the Company proposes to (i) pay any dividend payable
in stock to the holders of shares of Common Stock or to make any other
distribution to the holders of shares of Common Stock, (ii) offer to the
holders of shares of Common Stock rights to subscribe for or purchase
any additional shares of any class of stock or any other rights or
options or (iii) effect any reclassification of the Common Stock (other
than a reclassification involving merely the subdivision or combination
of outstanding shares of Common Stock), or any capital reorganization or
any consolidation or merger (other than a merger in which no
distribution of securities or other property is to be made to holders of
shares of Common Stock), or any sale, transfer or other disposition of
its property, assets and business as an entirety or substantially as an
entirety, or the liquidation, dissolution or winding up of the Company,
then, in each such case, the Company shall mail (by first class mail,
postage prepaid) to the Warrantholder notice of such proposed action,
which shall specify the date
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on which the books of the Company shall close, or a record to be taken,
for determining holders of Common Stock entitled to receive such stock
dividends or other distribution of such rights or options, or the date
on which such reclassification, reorganization, consolidation, merger,
sale, transfer, other disposition, liquidation, dissolution or winding
up shall take place or commence, as the case may be, and the date as of
which it is expected that holders of Common Stock of record shall be
entitled to receive securities or other property deliverable upon such
action, if any such date is to be fixed. Such notice shall be mailed in
the case of any action covered by clause (i) or (ii) above at least 10
days prior to the record date for determining holders of Common Stock
for purposes of receiving such payment or offer, and in the case of any
action covered by clause (iii) above at least 10 days prior to the date
upon which such action takes place and 10 days prior to any record date
to determine holders of Common Stock entitled to receive such securities
or other property.
(c) Failure to file any certificate or notice or to mail any
notice, or any defect in any certificate or notice, pursuant to this
Section 5.4, shall not affect the legality or validity of the adjustment
of the Exercise Price, the number of shares purchasable upon exercise of
this Warrant, or any transaction giving rise thereto.
5.5 CERTAIN DEFINITIONS. The following terms shall have the
meanings indicated below:
(a) "Convertible Securities" means evidences of indebtedness,
shares of stock or other securities which are convertible into or
exchangeable for, with or without payment of additional consideration in
cash or property, additional shares of Common Stock, either immediately
or upon a specified date or the happening of a specified event.
(b) "Current Market Price" per share of Common Stock on any
specified date means the highest of (a) the book value thereof as
determined in accordance with generally accepted accounting principles
but without any adjustment or reduction for the amount, if any, that
may, under modification to generally accepted accounting principles
after the date hereof, be required to be listed as an offset to or
reserve against earnings or retained earnings by any firm of independent
public accountants of recognized national standing selected by the
Company, as at the last day of any month ending within 60 days
immediately preceding such date or (b) the fair market value thereof as
determined in good faith by the Board of Directors of the Company as of
a date which is within 15 days of such date or (c) the average of the
daily market prices (determined as set forth in the next sentence), if
any, for 30 consecutive business days commencing 45 business days before
such date, except that for the purposes of Section 5.1(a) hereof the
"Current Market Price" per share of Common Stock, shall mean the market
price on the business day therein specified or (d) in the event that the
Holder shall at its option request an appraisal, the appraised value
thereof as determined by a national investment banking firm selected by
the Holder and acceptable to the Company (the cost of such appraisal to
be borne by the Company) determined without regard to the illiquidity of
the investment represented by the Common Stock and without discount by
reason of ownership of a minority interest. The
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market price for each such business day shall be the average of the last
sale prices on such day on all domestic stock exchanges on which the
Common Stock may then be listed, or, if no sale takes place on such day
on any such exchange, the average of the closing bid and asked prices on
such day as officially quoted on such exchanges, or, if Common Stock is
not then listed or admitted to trading on any domestic stock exchange,
the market price for each business day shall be the average of the
reported bid and asked prices on such day in the over-the-counter
market, as furnished by the National Quotation Bureau, Inc., or, if such
firm at the time is not engaged in the business of reporting such
prices, as furnished by any similar firm then engaged in such business
and selected by the Company or, if there is no such firm, as furnished
by any member of the National Association of Securities Dealers, Inc.,
selected by the Company.
5.6 VOLUNTARY ADJUSTMENT BY THE COMPANY. The Company may, at its
option, at any time during the term of the Warrant, reduce the then current
Exercise Price to any amount, consistent with applicable law, deemed appropriate
by the Board of Directors of the Company.
5.7 NO ADJUSTMENT FOR CASH DIVIDENDS. No adjustment in respect of
any cash dividends shall be made during the term of this Warrant or upon the
exercise of this Warrant.
6. REGISTRATION RIGHTS. The Company shall not enter into any agreement
obligating the Company to cause securities of the Company owned by any person or
entity to be registered under the Securities Act or the securities law of any
state unless the Company simultaneously grants rights to Equus and the
Contributing Shareholders (as that term is defined in the Funding and Stock
Purchase Agreement dated April 18, 1997, between the Company and Equus) which
are equal to the rights granted to such other person or entity.
7. NO IMPAIRMENT. The Company shall not by any action, including,
without limitation, amending its Certificate of Incorporation or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate to protect the
rights of the Warrantholder against impairment. Without limiting the generality
of the foregoing, the Company will (a) not change the par value of any shares of
Common Stock receivable upon the exercise of this Warrant to an amount greater
than the amount payable therefor upon such exercise, (b) take all such action as
may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and nonassessable shares of Common Stock upon the
exercise of this Warrant, (c) obtain all such authorizations, exemptions or
consents from any public regulatory body having jurisdiction thereof as may be
necessary to enable the Company to perform its obligations under this Warrant,
and (d) not undertake any reverse stock split, combination, reorganization or
other reclassification of its capital stock which would have the effect of
making this Warrant exercisable for less than one share of Common Stock.
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Upon the request of the Holder, the Company will at any time during the
period this Warrant is outstanding acknowledge in writing, in form reasonably
satisfactory to the Holder, the continued validity of this Warrant and the
Company's obligations under it.
8. MISCELLANEOUS.
8.1 ENTIRE AGREEMENT. This Warrant constitutes the entire
agreement between the Company and the Warrantholders with respect to this
Warrant and Warrant Shares.
8.2 BINDING EFFECTS; BENEFITS. This Warrant shall inure to the
benefit of and shall be binding upon the Company, the Warrantholders and holders
of Warrant Shares and their respective heirs, legal representatives, successors
and assigns. Nothing in this Warrant, expressed or implied, is intended to or
shall confer on any person other than the Company, the Warrantholders and
holders of Warrant Shares, or their respective heirs, legal representatives,
successors or assigns, any rights, remedies, obligations or liabilities under or
by reason of this Warrant or the Warrant Shares.
8.3 AMENDMENTS AND WAIVERS. This Warrant may not be modified or
amended except by an instrument in writing signed by the Company and the
Warrantholder. The Company, any Warrantholder or holders of Warrant Shares may,
by an instrument in writing, waive compliance by the other party with any term
or provision of this Warrant on the part of such other party hereto to be
performed or complied with. The waiver by any such party of a breach of any term
or provision of this Warrant shall not be construed as a waiver of any
subsequent breach.
8.4 SECTION AND OTHER HEADINGS. The section and other headings
contained in this Warrant are for reference purposes only and shall not be
deemed to be a part of this Warrant or to affect the meaning or interpretation
of this Warrant.
8.5 FURTHER ASSURANCES. Each of the Company, the Warrantholders
and holders of Warrant Shares shall do and perform all such further acts and
things and execute and deliver all such other certificates, instruments and/or
powers of attorney as may be necessary or appropriate) as any party hereto may,
at any time and from time to time, reasonably request in connection with the
performance of any of the provisions of this Warrant.
8.6 NOTICES. All demands, requests, notices and other
communications required or permitted to be given under this Warrant shall be in
writing and shall be deemed to have been duly given if delivered personally or
sent by United States certified or registered first class mail, postage prepaid,
to the parties hereto at the following addresses or at such other address as any
party hereto shall hereafter specify by notice to the other party hereto:
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(a) if to the Company, addressed to:
Healthtech Delivery, Inc.
0000 Xxxxxxxxxx Xxxxxx
Xxxx Xxxx, Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx, Xx.
President and Chief Executive Officer
(b) if to any Warrantholder or holder of Warrant Shares,
addressed to the address of such person appearing on the books of the
Company.
Except as otherwise provided herein, all such demands, requests,
notices and other communications shall be deemed to have been received on the
date of personal delivery thereof or on the third Business Day after the mailing
thereof.
8.7 SEPARABILITY. Any term or provision of this Warrant which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable any other term or provision of this Warrant
or affecting the validity or enforceability of any of the terms or provisions of
this Warrant in any other jurisdiction.
8.8 FRACTIONAL SHARES. No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of this Warrant. With
respect to any fraction of a share called for upon any exercise hereof, the
Company shall pay to the Warrantholder an amount in cash equal to such fraction
multiplied by the Current Market Price.
8.9 RIGHTS OF THE HOLDER. The Warrantholder shall not, solely by
virtue of this Warrant, be entitled to any rights of a stockholder of the
Company, either at law or in equity.
8.10 GOVERNING LAW. This Warrant shall be deemed to be a contract
made under the laws of the State of Delaware and for all purposes shall be
governed by and construed in accordance with the laws of such State applicable
to contracts made and performed in Delaware.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by
its duly authorized officer as of the date first written above.
HEALTHTECH DELIVERY, INC.
By: /s/ XXXXXXX X. XXXXXXXXXX, XX.
Xxxxxxx X. Xxxxxxxxxx, Xx.
President and Chief Executive Officer
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EXERCISE FORM
(To be executed upon exercise of this Warrant)
The undersigned, the record holder of this Warrant, hereby irrevocably
elects to exercise the right, represented by this Warrant, to purchase _________
of the Warrant Shares and herewith tenders payment for such Warrant Shares to
the order of HEALTHTECH DELIVERY, INC., in the amount of $ _____________ in
accordance with the terms of this Warrant. The undersigned requests that a
certificate for such Warrant Shares be registered in the name of
_________________ and that such certificate be delivered to _________________
whose address is _________________.
Date_______________ Signature:_______________________________
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